Poverty policy and regulation

As a fast-developing nation, Cambodia has always found poverty one of its main challenges. The Rectangular Strategy states that eradicating poverty has long been one of the Royal Government of Cambodia’s (RGC’s) highest priorities.1 Since the country’s first major post-civil war election in 1993, Cambodia has seen remarkable growth and economic development.2 The Kingdom has implemented structural reform policies to liberalize the economy and bring it into regional and global markets.3 The Government has also reformed trade policies and provided favorable foreign investment incentives and tax exemption to boost the economy.4 These have resulted in rapid economic growth and poverty reduction.5 According to the World Bank, Cambodia has maintained average annual growth of 7.7 percent since 1998.6 The country has been recognized as one of the fastest-growing countries in the world. Cambodia graduated to a lower-middle-income country in 2015 and has set a target of becoming an upper-middle-income country by 2030.7 

A Cambodian farmer gets her first harvest with her husband. Photo by World Bank, taken on 12 December 2014. licensed under CC BY-ND 2.0.

This growth has contributed to a substantial decline in the poverty rate. In 1993, the poverty rate in the country was around 39 percent.8 By 2014, the poverty rate had dropped to 13.5 percent. 9 The number dropped even further, to 9 percent by 2019.10 Even though poverty is continued to decrease, the bottom 40 percent of the population is not doing well.11 Robust economic growth is benefitted the non-poor more while leaving urban poverty unchanged.12

The RGC has recognized that poverty in Cambodia is multidimensional, not limited to income inequality.13 Other dimensions of poverty are the lack of opportunities, capabilities, good governance, and social exclusion.14This indicates that poverty still exists and policies and regulations will play an essential role in addressing the challenges. 

Poverty policy and regulation 

The Royal Government of Cambodia has implemented various poverty policies and guidelines to tackle poverty and raise citizens’ standard of living, such as the National Poverty Reduction Strategy 2003–2005, Rectangular Strategy Phase IV, and National Strategic Development Plan 2019–2023. The Government has also committed to international development agendas such as Millennium Development Goals and Sustainable Development Goals, in which one of the goals is to eliminate poverty and hunger.

The National Poverty Reduction Strategy 2003–2005 was the first national strategic framework that established visions, objectives and actionable measures to tackle poverty in Cambodia. Priority areas mentioned in the framework were microeconomic stabilities, improving rural livelihood, expanding job opportunities, improving capabilities, strengthening institutions and improving governance, reducing vulnerability and strengthening social inclusion, promoting gender equality, and focusing on population.

In a similar fashion, Rectangular Strategy Phase IV is an effective national policy instrument that offers various poverty reduction strategies to transform the livelihoods of the poor. The four areas of focus (which explain the word ‘rectangle’ in the strategy’s title) are human resource development, economic diversification, promotion of the private sector and employment and inclusive and sustainable development.

The National Strategic Development Plan 2019–2023 offers a more comprehensive approach toward poverty reduction by taking the four areas of focus mentioned in Rectangular Strategy Phase IV as a roadmap. The NSDP 2019–2023 identifies indicators, frameworks, and priorities for implementation. It also indicates the key responsibilities of the relevant ministries and agencies to monitor and evaluate the implementation processes. 

Access to education 

The RGC has fully recognized the importance of education as a mechanism to increase and accumulate human resources and capital, which contributes to eliminating poverty and narrowing social gaps. The Constitution states in article 68 that Cambodian citizens are entitled to access nine years of education for free. This underpins the Government’s push for universal access to education. Not entirely focusing just on access, education reforms also aim to improve education quality and promote inclusive education for all to ensure that everyone receives the same quality education.

The Government and the Ministry of Education, Youth and Sport (MoEYS) implement numerous policies and guidelines to enhance children’s access to education and education quality. The Education Strategic Plan and Cambodian Education Roadmap 2030 are the core strategic framework. The two medium term education policies that MoEYS has adopted to ensure that it aligns with the RGC Rectangular Strategy are15

  • Policy 1: Ensure inclusive and equitable quality education and promote life-long learning opportunities for all. 
  • Policy 2: Ensure effective leadership and management of education officials at all levels. 

Over the last decade, Cambodia has done well in improving its education sector.16 Figures show that 97.7 % of all eligible children had access to education by 2016.17 Student dropout and repetition rates have declined. In the 2018–2019 school year, the primary school dropout rate was 4.4%, while the repetition rate stood at 6.6%.18 Primary schools are available in all areas of the country, including in remote and rural areas, which means students can get to school.

Social security protection

Poverty reduction is highly associated with adequate social protection policies. The long-term vision of RGC is to establish a financially sustainable system that can serve as an effective tool to tackle poverty, promote equality and enhance human capital development.19 In 2017, the Government established the Social Protection Policy Framework (SPPF).20 The policy framework aims are: “harmonizing, integrating and strengthening existing schemes and expanding the social protection floor to respond to all contingencies throughout the lifecycle.” Two main pillars at the core of the framework are social assistance and social insurance.21

Cambodia Social Protection Framework. Taken from National Social Protection Policy Framework 2016-2025, figure 9, page 10.

Social assistance supports the most vulnerable group of people and is divided into four main categories: emergency response, human capital development, vocational training and welfare provision to the most vulnerable people.22 Three groups of poor and vulnerable people who are entitled to receive benefits from social assistance programs are people who live below the poverty line, people who live close to the poverty line and vulnerable groups including infants, children, pregnant women, family with food insecurity, people with disabilities and elderly.23 The Social Health Equity Fund (HEF), Food Reserve Program, Nutrition Program, Scholarship Program and School Feeding Program are the social assistance programs implemented so far.24 Among all, Social Health Equity Fund is the largest social protection intervention that provides benefits and health care to no less than 2 million vulnerable Cambodians. 25

The social insurance system or social security system consists of five primary components: pension, health insurance, work injury insurance, unemployment insurance and disability insurance.26 The social security system requires its members to pay contributions to the Government based on their income level. For those who cannot pay the contribution on their own, the Government will handle the cost.27 Established in 2007, the National Social Security Fund (NSSF) is the focal point for providing further social protection schemes for the public and private sectors.28 NSSF oversees various social security schemes such as employment injury insurance and social health insurance for private-sector workers and civil servants, and pensions.29 

The Ministry of Planning has established the IDpoor program in 2006 to further support the poverty reduction campaign. The program aims to reduce duplication of resources and improve the identification of poor households for different poverty reduction measures.30 It is supported by the German and Australian governments and implemented by German Development Cooperation Agency (GIZ).31 All rural areas across the country are covered since 2013.32 Around 63% of all development programs in Cambodia are using IDpoor data in 2015.33  The statistic shows an increase from 42 projects in 2012 to 136  in 2015.34

IDpoor program is a process that identifies poor households in rural areas through its standardized questionnaires and procedures. Two poverty categories will be identified based on questionnaire scores including Poor level1 (very poor) and Poor level2 (poor).35 The program has provided useful regularly updated information on poor households and their poverty level to all relevant policymakers, governments and non-government agencies to further identify services, assistances and beneficiaries to those that are poverty-stricken. During the COVID-19 pandemic, the government has distributed approximately 291 million dollars to around 700,000 IDpoor households through the government Emergency Cash Transfer program.36

Related to Poverty policy and regulation

References

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